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Even sports takes a hit from the crisis

Marketplace Staff Oct 2, 2008
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Even sports takes a hit from the crisis

Marketplace Staff Oct 2, 2008
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TEXT OF INTERVIEW

Kai Ryssdal: Baseball’s post-season started last night. The NFL is going to be playing a full schedule this weekend. But I wanted to direct your attention to the ladies pro golf tour. It’s in Half Moon Bay, California, this week for its World Championship. More properly, it’s the Samsung World Championship, which comes a week after the Navistar LPGA Classic and a week before the Long’s Drugs Challenge.

Diana Nyad’s here to talk sports and what the crisis on Wall Street is doing to its corporate clients. Hey, Diana.

Diana Nyad: How are you, Kai?

Ryssdal I’m good, you know, it’s all credit all the time. But that’s why you’re here because it actually is affecting sports, isn’t it?

Nyad: You know it is. I mean, the NBA has already announced they’re just kicking off their season, not even yet. And they have announced they’re gonna cut their workforce by about 6 percent. Major League baseball, this World Series and the whole post-season is going to be popular. People want some good news. They want something fun to watch. So, I don’t think the series will be hurt television ratings-wise, but 25 percent of the advertisers for Major League post-season are the financial companies, and so they’ve lost those. And so they’re in sort of a panic to get that beefed that up. I guess they are doing all right. But the sport that’s really, you know, kind of in a quandary over this is golf. Who has deeper pockets and outreached pockets than golf with the financial institutions?

Ryssdal Well, let’s talk more about that, because obviously it’s been trickier that it had the Tiger Woods effect. He’s out with a knee injury, and then granted the Ryder Cup was a big win for this country. What about those corporate sponsorships? Because that’s really what that game is all about?

Nyad: You know it is. Twenty-six such institutions — credit card companies, brokerage houses — you know, had their names on PGA tournaments. And now, three of the biggies — so we’re talking about AIG, Wachovia and Merrill Lynch — I mean, if the three of those are gonna virtually disappear — they may be taken over, of course, and all those tournaments be saved — they are scrambling at the moment. On the other hand, I called a senior executive at Citigroup yesterday and she said, “Diana, do you really think that we are sitting in a big room in New York City in our glass tower right now talking right golf tournaments? Trust me. These men are sweating in their expensive Italian suits, and it’s not over the Wachovia golf tournaments.”

Ryssdal Let’s go to next year. What’s it gonna look like in 2009 as this whole credit thing washes through the economy?

Nyad: I think that what we’re really gonna see is that sort of hospitality end of golf, which is very big. You know, you and I might watch the final round on a Sunday, but that’s not really where the huge money making takes place. It takes place earlier in the week, when they have the big pro-am or some guy with $12,000 to get to play a round with V.J. Singh. Well, those are going to start going away. The tournament may still keep happening, the name of it may change, but all the big money making is going to come down in a big way in ’09.

Ryssdal Let me ask you about the trickle down effect really quickly to the television broadcasts. A lot of those advertisers are banks and other companies who are having some problems, as well.

Nyad: Yeah, they are. I mean, there are certain tournaments like the FBR in Phoenix and Scottsdale, it’s hot and those local businessmen are going to keep that propped up. But when you think that one-third of all the PGA events, the television dollars, for one-third of them are now coming from those financial institutions. All of a sudden, what are they going to turn to? Domestic cars? I think some sweating is going on at the moment.

Ryssdal The troubled business of sports, Diana Nyad. Thanks, Diana.

Nyad: Kai, thank you.

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